E-COMMERCE WAREHOUSING: A FIGHT BETWEEN TWO GIANTS

Getting logistics and warehousing right is very key to the success of e-commerce in Nigeria. Warehousing and logistics are very key to the timely delivery of goods to shoppers. Products that are warehoused with the e-commerce platforms will get to shoppers earlier than products that are not warehoused, On Jumia, this feature is called Jumia express (customers get their orders within 24hours). Although, warehousing is very vital to the success of e=commerce in Nigeria, the cost of maintaining a warehouse is very high, which is attributed to factors like high cost of labour, electricity bill, high cost of rent and warehouse operational cost.

How does Jumia and Konga Survive? who bears the cost of warehosusing?

As at today on Jumia, Vendors are charged if their items stay beyond 2 weeks in the Jumia warehouse. Vendors are charged per sku per day for the entire period their product stays in the Jumia warehouse. One of the good things vendors enjoy on Jumia express is reduced shipping contribution cost, zero cost of packaging as opposed to the huge sums of naira vendors spend on packaging materials (especially on bubble wrap, jumia customised cartons, and fragile tapes) On Konga, the process is quite different, as vendors are not charged even if their items stay beyonds 1 month/ (There was a time we had our product inbounded in the Konga warehouse for over 1 month, and we were not charged anything!. I mean Nothing!)

Till date i still wonder how Konga keeps up with the ever-rising warehosuing cost, but then i realized that Konga has a chain of retail stores, and to service these stores they need to run a 360 warehousing system, so they don,t run out of stock, which also helps them to reduce cost. Konga is also running a free warehousing system as an added value to beat their one and only competition|JUMIA.

As a vendor, If i can warehouse my products with Konga at no cost. who cares about Jumia Lol.

How are vendors coping with the 2 weeks Jumia warehousing charge?

Vendors are now wise. Why keep your items beyond two weeks on Jumia when you can keep them for 2 weeks and incur no charges? Vendors have outsmarted the system by outbounding their products before two weeks, thereby saving themselves extra cost of warehousing. Vendors have so outsmarted the system that they don't outbound the products physically, but all they do is bring new invoices, that shows a change of date (and of course retrieve the old invoice)